Market intelligence (MI) is gathering and analyzing information relevant to a company's market - trends, competitor and customer (existing, lost and targeted) monitoring. It is a subtype of

competitive intelligence Competitive intelligence (CI) is the process and forward-looking practices used in producing knowledge about the competitive environment to improve organizational performance. Competitive intelligence involves systematically collecting and anal ...

(CI), which is

data Data ( , ) are a collection of discrete or continuous values that convey information, describing the quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpreted for ...

and

information Information is an Abstraction, abstract concept that refers to something which has the power Communication, to inform. At the most fundamental level, it pertains to the Interpretation (philosophy), interpretation (perhaps Interpretation (log ...

gathered by companies that provide continuous insight into market trends such as competitors' and customers' values and preferences. MI along with the

marketing Marketing is the act of acquiring, satisfying and retaining customers. It is one of the primary components of Business administration, business management and commerce. Marketing is usually conducted by the seller, typically a retailer or ma ...

capabilities of an organization provides a guideline into the allocation and implementation of resources and processes. It is used for the purpose of continuously supplying strategic marketing planning for organizations to gauge marketing positions in order for companies to gain

competitive advantage In business, a competitive advantage is an attribute that allows an organization to outperform its competitors. A competitive advantage may include access to natural resources, such as high-grade ores or a low-cost power source, highly skille ...

and best meet objectives. Organizations can develop MI frameworks and models that are suited to financial capabilities and desired market sectors but are mainly based on the four-step process of collection, validation, processing and communication of MI. The gathering of MI data is sorted into many different categories, including, but not limited to, qualitative, quantitative, formal, informal, published, and unpublished. MI data is gathered both internally and externally. Benefits that MI can bring are that it provides

customer In sales, commerce, and economics, a customer (sometimes known as a Client (business), client, buyer, or purchaser) is the recipient of a Good (economics), good, service (economics), service, product (business), product, or an Intellectual prop ...

, competitor and market insights allowing

organization An organization or organisation (English in the Commonwealth of Nations, Commonwealth English; American and British English spelling differences#-ise, -ize (-isation, -ization), see spelling differences) is an legal entity, entity—such as ...

s to gain a

in their marketing strategies. Issues that MI can bring is through acquiring

and information through illegal or unethical ways, it can lead to financial loss and government regulatory failures.

Background and Development

MI and its broader term, marketing intelligence, was first introduced in “Marketing Intelligence for Top Management” by Kelley, to provide information that was analyzed, reliable and consistent for an organization to better create policies and make

business Business is the practice of making one's living or making money by producing or Trade, buying and selling Product (business), products (such as goods and Service (economics), services). It is also "any activity or enterprise entered into for ...

decisions. Following Kelley, in “How to Develop a Marketing Intelligence System”, R. Pinkerton shows the proactiveness of organizations as marketing intelligence systems is applied whilst the technological revolution arises. Contributions to MI include professional organizations such as “Global Intelligence Alliance” and “the Society of Competitive Intelligence Professionals” (SCIP). These organizations have contributed both

empirical Empirical evidence is evidence obtained through sense experience or experimental procedure. It is of central importance to the sciences and plays a role in various other fields, like epistemology and law. There is no general agreement on how t ...

and theoretical research in an attempt to further define and understand MI. As research into MI comes from

scholar A scholar is a person who is a researcher or has expertise in an academic discipline. A scholar can also be an academic, who works as a professor, teacher, or researcher at a university. An academic usually holds an advanced degree or a termina ...

s and non-scholars of different backgrounds it has resulted in a fragmented state of research. This has led to MI being used interchangeably with other market terms such as

business intelligence Business intelligence (BI) consists of strategies, methodologies, and technologies used by enterprises for data analysis and management of business information. Common functions of BI technologies include Financial reporting, reporting, online an ...

and strategic intelligence. MI to this current date continues to change to meet organizational requirements.

Framework

The implementation of MI varies depending on how

s perceive it. MI is defined as being composed of three main activities, these activities are Information Acquisition, the gathering of

information that is required for current and future customer needs, Information Analysis which is the intelligence gained from the information collected and Information Activation, which is using the intelligence to implement and develop marketing plans. Frameworks can be flexible, however the basis that

s use to model the MI surrounds a four-step process, which are, collection, validation, processing and communication.

Data mining Data mining is the process of extracting and finding patterns in massive data sets involving methods at the intersection of machine learning, statistics, and database systems. Data mining is an interdisciplinary subfield of computer science and ...

techniques are used throughout the processes to aid in the gathering and analyzing of

and information retrieved. MI is a continuous process that organizations need to keep track of to improve their strategic and tactical

planning. These processes target the three activities that MI is defined by. The model can be adjusted and adapted when required and can be implemented all at once or by sections.

Collection

Collection is the first step in the MI model, it involves the gathering of

and

of a particular market sector. Such

and information can be gathered from external sources, such as other organisations and their market strategies,

research institute A research institute, research centre, or research organization is an establishment founded for doing research. Research institutes may specialize in basic research or may be oriented to applied research. Although the term often implies natural ...

s and business reports. Internal factors can include looking into current strategy processes and personal customer trends. It is estimated that 70% to 80% of

intelligence Intelligence has been defined in many ways: the capacity for abstraction, logic, understanding, self-awareness, learning, emotional knowledge, reasoning, planning, creativity, critical thinking, and problem-solving. It can be described as t ...

resides within

s employees or, internal MI network, as they are the team who gains information's when interacting with suppliers, customers and other industry contacts. To involve employees into an intelligence program to gain

and

the following considerations can be noted: developing a rewards program to promote participation, providing MI goals, requirements and a timeframe for information to be given in and creating a proper

communication Communication is commonly defined as the transmission of information. Its precise definition is disputed and there are disagreements about whether Intention, unintentional or failed transmissions are included and whether communication not onl ...

method to promote the intelligence program with employees such as using an

e-mail Electronic mail (usually shortened to email; alternatively hyphenated e-mail) is a method of transmitting and receiving Digital media, digital messages using electronics, electronic devices over a computer network. It was conceived in the ...

system. A challenge that arises in the collection of

and information is the identification of relevant information, this is a result of organizations not clearly defining a market sector.

Validation

Validation is the second step in the MI model, this which can be referred to as data cleansing. The maintenance of good data quality is important as

and information is being retrieved from many different sources.

Data Data ( , ) are a collection of discrete or continuous values that convey information, describing the quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpreted for ...

and

obtained from sources can be dirty, meaning that it is incomplete, wrong, inappropriate, duplicated. This step will allow

and

to be adjusted and understandable to the organization, furthermore it allows for consistency and compliance to be present. If data quality is not maintained correctly it can lead to organizational losses with

revenue In accounting, revenue is the total amount of income generated by the sale of product (business), goods and services related to the primary operations of a business. Commercial revenue may also be referred to as sales or as turnover. Some compan ...

and governmental

regulation Regulation is the management of complex systems according to a set of rules and trends. In systems theory, these types of rules exist in various fields of biology and society, but the term has slightly different meanings according to context. Fo ...

failures.

Method of Validation

Data cleansing is a complex process that involves several stages in order to get good data quality for MI strategy use. Stages include defining the organization's level of data quality, detecting error from the data collected and then repairing the errors. The five stages of data cleansing are data analysis to identify errors, eliminating the errors, checking to ensure elimination of error are done appropriately, refreshing the data in the

data warehouse In computing, a data warehouse (DW or DWH), also known as an enterprise data warehouse (EDW), is a system used for Business intelligence, reporting and data analysis and is a core component of business intelligence. Data warehouses are central Re ...

and finally replacing the dirty data with clean data.

Processing

Processing is the third step in the MI model. It involves the use of translating the clean data using organizational rules, modelling, logic and analysis to produce readable information, reports and spreadsheets that allows the organization to gain specified knowledge. The interpretation of data into readable information is difficult as it is complex, it requires proper technology and heavy commitment from a top organizational level to match data and information gained and align it to a marketing strategy.

Communication

Communication is the last step in the MI model. It involves the sharing, delivering and transmission of information gained from the processing step to figures in the organization who will apply it accordingly to the market strategy. As MI is a continuously changing, the communication of the MI strategy requires managers whom have expertise in the given market industry in order to determine the ongoing validity of the MI strategy and its implementation. In order to make the communication of the MI strategy as successful as possible, this process must be performed by every level of an organization, also known as the intelligence organization.

Intelligence Organization

Intelligence organization refers to the “people and information resources who make the market intelligence process happen”. The five elements of an intelligence organization are, MI leadership who manages and leads the MI process, a MI team, a portfolio of external information sources that is set up by the MI team, internal MI network made up of MI users and the MI user's personal information source network. An intelligence organization element is made up of external and internal factors that allows for a continuous MI process.

Gathering market intelligence data

The gathering of MI data is different dependent on an organization's financial capabilities. Sources of

and information is separated into qualitative, quantitative, formal, informal, published and unpublished. With such sources being retrieved both internally and externally from the organization. It involves using

search engine A search engine is a software system that provides hyperlinks to web pages, and other relevant information on World Wide Web, the Web in response to a user's web query, query. The user enters a query in a web browser or a mobile app, and the sea ...

s and corporate web sites to see competitor's strategies, identifying business trends through reputable publications and existing customer clientele. Organizations use different systems to gather MI, one system is that is used is Open-source Intelligence system.

Internal intelligence gathering

Sources of internal intelligence gathering include but are not limited to, gathering

from customers, manufacturers, through

research and development Research and development (R&D or R+D), known in some countries as OKB, experiment and design, is the set of innovative activities undertaken by corporations or governments in developing new services or products. R&D constitutes the first stage ...

(R&D), employees, also known as salesforce, physical evidence, sales quotes, sales records, trade shows and new hires. These data sources were ranked by organizations on a scale measuring five for being very important to one being not important. It was founded that customers and manufacturers and R&D are the most important to organizations with one hundred percent of organizations ranking these data sources with the number four or higher^,. It shows that in the process of collection and gathering MI

and information, these data sources brought the most value to organizations.

External intelligence gathering

Sources of external intelligence gathering is included but is not limited to, gathering

from client meetings, dealers/distributors,

s, business associates,

market research Market research is an organized effort to gather information about target markets and customers. It involves understanding who they are and what they need. It is an important component of business strategy and a major factor in maintaining com ...

projects, suppliers, online services, periodicals and government publications. These data sources were compared on the same scale as internal intelligence gathering sources, with results showing that intelligence gathered through client meetings being the most important to organizations, with one hundred percent of organizations ranking this data source with the number four or higher.

Information systems intelligence gathering

Marketing information systems allow for organizations to continuously acquire, generate, and maintain external and internal information. They are systems that make use of

artificial intelligence Artificial intelligence (AI) is the capability of computer, computational systems to perform tasks typically associated with human intelligence, such as learning, reasoning, problem-solving, perception, and decision-making. It is a field of re ...

(AI) technology to aid in the planning of strategic and tactical

marketing strategy Marketing strategy refers to efforts undertaken by an Organizational structure, organization to increase its sales and achieve competitive advantage. In other words, it is the method of advertising a company's products to the public through an est ...

of MI but also share marketing expertise.

Open-source Intelligence (OSINT)

Open-source intelligence Open source intelligence (OSINT) is the collection and analysis of data gathered from open sources (overt sources and publicly available information) to produce actionable intelligence. OSINT is primarily used in national security, law enforceme ...

is a predominant form of MI gathering that organizations employ. OSINT is defined as the scanning, finding, gathering, exploitation, validation, analysis, and sharing with intelligence-seeking clients of publicly available print and digital/electronic

from unclassified, non-secret, and

grey literature Grey literature (or gray literature) is material and research produced by organizations outside of the traditional publishing, commercial or academic publishing and distribution channels. Common grey literature publication types include reports (a ...

. It is frequently used as its system is user friendly, its inexpensive and that it processes an abundant amount of

raw material A raw material, also known as a feedstock, unprocessed material, or primary commodity, is a basic material that is used to produce goods, finished goods, energy, or intermediate materials/Intermediate goods that are feedstock for future finished ...

s that can be further processed.

Impacts of market intelligence

Using MI can bring to organizations both benefits and issues depending on how MI is acquired, maintained, and implemented. Benefits that MI can bring includes but is not limited to gaining

in their marketing strategies. Issues that MI can bring can include but is not limited to, financial losses and government regulatory failures.

Issues

There are issues that arises in the process of acquiring MI data and information and the implementation of an organizations

. Issues such as the acquiring intelligence unethically and illegally can lead to failures with government regulations, also, if dirty data is not properly cleansed and problems aren't mitigated or resolved can lead to a range of negative impacts that can result in financial and reputational losses to the organization.

Legality and ethics

An issue that can arise is the unethical and illegal collection of

and information. Organizations can collect data for MI illegally or unethically to try to gain

s; this is known as

industrial espionage Industrial espionage, also known as economic espionage, corporate spying, or corporate espionage, is a form of espionage conducted for commercial purposes instead of purely national security. While political espionage is conducted or orchestrat ...

. An example of illegal MI collection practice is when

British Airways British Airways plc (BA) is the flag carrier of the United Kingdom. It is headquartered in London, England, near its main Airline hub, hub at Heathrow Airport. The airline is the second largest UK-based carrier, based on fleet size and pass ...

breached the Data Protect Act 1984 through accessing Virgin's confidential flight details. A standard of conduct was developed by the non-for-profit organization Society of Competitive Intelligence Professionals, creating a code of ethics that can be adhered to by organizations when collecting market intelligence, to prevent the illegal and unethical collection of data and information.

Dirty Data

Dirty data that is collected needs to be cleansed to maintain good data quality. Challenges that arise in data cleansing is that there is a large volume of data being received leading to organizations being faced with many risks of failure to detect dirty data being processed through. If data quality is not managed properly, it can result in financial losses, inefficient implementation of MI strategies and failure to comply with government regulations. A reason for financial loss is due operational costs, as there is an increase in resources and time spent to identify and fix the dirty data.

Benefits

MI processes have been used in many organization's strategic market planning, however, there are still difficulties in what the hard and soft benefits in using a MI process for an organization. The benefits of a successful MI process can be sectioned into three categories, better and faster decisions, time and cost savings and organizational learning and new ideas, however, overall, it can improve profitability and the competitiveness of an organization. The competitiveness of an organization increases as with more MI gathered it'll provide a way for organizations to innovate through improving current methods and increasing the ability to find and create new products.

References

{{DEFAULTSORT:Market intelligence Intelligence gathering disciplines Business intelligence terms